The S&P 500 and global foreign-exchange risk gauge AUD/JPY have markedly slowed the rallies they started after March's coronavirus nadirs, and growing pandemic recovery and U.S. fiscal aid difficulties nL2N2F01FHnW1N2B8001nAPN0G1IYW are adding to the risk of a correction in both.
With U.S. continuing jobless claims rebounding to a horrendously high 17.018 million and initial claims at 1.434 million, up for a second week, S&Ps have slipped toward last Friday's pullback low at 3,200.
This follows failed attempts this week to retake the broken uptrend line off the June 29 low and after July's minor new recovery high left behind an overbought RSI bearish divergence.
Investors could come to question the buy-the-dip bull market premise if the S&P 500 were to start making lower -- rather than higher -- pullback lows and close below the pivotal 50-day moving average, now at 3,131.
AUD/JPY, which is highly positively correlated with S&Ps, topped out in June and July close to December's pre-pandemic peak, with an RSI bearish divergence and 30-DMA support at 74.67 nearby.
A close below it could see the 200-DMA at 72.43 tested.
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